Mumbai16 minutes ago
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The value of 3 of the country’s 10 largest companies in terms of market capitalization increased by Rs 75,855.43 crore in last week’s trading. During this period, the value of the country’s largest government bank SBI has increased the most.
SBI’s market cap has increased by Rs 39,045.51 crore to ₹9.62 lakh crore. Infosys’ market value has increased by ₹31,014.59 crore to ₹7.01 lakh crore. Whereas the market cap of ICICI Bank has increased by Rs 5,795.33 crore to ₹ 10.09 lakh crore.
Whereas the market value of Reliance Industries, HDFC Bank, Tata Consultancy Services (TCS), Bharti Airtel, Bajaj Finance, Hindustan Unilever and Larsen & Toubro has declined by a total of Rs 75,549.89 crore.
Three companies – SBI, Infosys and ICICI Bank – have gained more than the loss suffered by these seven companies. A total increase of Rs 75,855.43 crore has been recorded in the market cap of these three companies.
Reliance’s market cap reduced by ₹23,952 crore
The market cap of Reliance Industries has declined by ₹23,952 crore to ₹19.72 lakh crore. Larsen & Toubro’s market value declined by ₹23,501.8 crore to ₹5.30 lakh crore. Whereas the market cap of HDFC Bank has declined by ₹11,615.35 crore to ₹14.32 lakh crore.
What is market capitalization?
Market cap is the value of the total outstanding shares of any company, i.e. all those shares which are currently held by its shareholders. It is calculated by multiplying the total number of issued shares of the company by their price.
Understand this with an example…
Suppose… people have bought 1 crore shares of company ‘A’ in the market. If the price of a share is Rs 20, then the market value of the company will be Rs 1 crore x 20 i.e. Rs 20 crore.
The market value of companies increases or decreases due to increase or decrease in share prices. There are many other reasons for this…
| what does it mean to grow | what does decrease mean |
| increase in share price | decline in share price |
| strong financial performance | bad results |
| positive news or event | Negative news or event |
| positive market sentiment | Economy or market decline |
| Issuing shares at high price | Share buyback or delisting |
What effect do market cap fluctuations have on the company and investors?
Impact on the company: A large market cap helps the company to raise funds from the market, take loans or acquire other companies. At the same time, small or low market cap reduces the ability of the company to take financial decisions.
Impact on investors: Investors directly benefit from increasing market cap. Because the price of their shares increases. At the same time, the fall may cause losses, due to which investors may decide to sell shares.
Example: If TCS’s market cap grows by ₹12.43 lakh crore, investors’ wealth will increase, and the company may get more capital for future investments. But if the market cap falls then it may incur losses.
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